Hepatocellular carcinoma (HCC) is a common cancer. The purpose of this study was to characterize two tumor suppressor genes (TSGs), hDAB2IPA and DLEC1 in HCC. hDAB2IPA was silenced in liver cancer cell lines. The hypermethylation and expression was correlated in primary HCC. More than 80% of HCC showed hypermethylation. Consistent with its role as a TSG, hDAB2IPA is suppressed in HCC by DNA methylation. DLEC1 was silenced and hypermethylated in nine of 11 HCC cell lines examined. The hypermethylation and expression was correlated in primary HCC. Hypermethylation of DLEC1 was detected in 70.6% of HCC tumors and associated with the AJCC staging. DLEC1 decreased colony formation and induced a G1 arrest. Our data indicate that DLEC1 is a candidate TSG silenced by DNA methylation and plays an important role in HCC. The mechanism that the G1 cell cycle arrest by DLEC1 is likely mediated by the upregulation of p21.